FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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The following information is taken from the accounts of Latta Company. The entries in the T-accounts are summaries of the transactions that affected those accounts during the year.

 

Manufacturing Overhead
Debit Credit
(a) 460,000 (b) 390,000
Balance 70,000    

 

Work in Process
Debit Credit
Balance 15,000 (c) 710,000
  260,000    
  85,000    
(b) 390,000    
Balance 40,000    

 

Finished Goods
Debit Credit
Balance 50,000 (d) 640,000
(c) 710,000    
Balance 120,000    

 

Cost of Goods Sold
Debit Credit
(d) 640,000    

 

The overhead that had been applied to production during the year is distributed among Work in Process, Finished Goods, and Cost of Goods Sold as of the end of the year as follows: 

 

Work in Process, ending $ 19,500
Finished Goods, ending 58,500
Cost of Goods Sold 312,000
Overhead applied $ 390,000

 

For example, of the $40,000 ending balance in work in process, $19,500 was overhead that had been applied during the year.

 

Required:.

2. Assume that the underapplied or overapplied overhead is closed to Cost of Goods Sold. Prepare the necessary journal entry.

3. Assume that the underapplied or overapplied overhead is closed proportionally to Work in Process, Finished Goods, and Cost of Goods Sold. Prepare the necessary journal entry.

 

 
 
Journal entry worksheet
1
Record the adjustment of manufacturing overhead account to COGS.
Note: Enter debits before credits.
Event
a.
Record entry
General Journal
Clear entry
Debit
Credit
View general journal
>
expand button
Transcribed Image Text:Journal entry worksheet 1 Record the adjustment of manufacturing overhead account to COGS. Note: Enter debits before credits. Event a. Record entry General Journal Clear entry Debit Credit View general journal >
Journal entry worksheet
<
1
Record the allocation of any balance in the manufacturing overhead account to
other accounts.
Note: Enter debits before credits.
Event
a.
General Journal
Debit
Credit
expand button
Transcribed Image Text:Journal entry worksheet < 1 Record the allocation of any balance in the manufacturing overhead account to other accounts. Note: Enter debits before credits. Event a. General Journal Debit Credit
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